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The Arkansas Natural Resources Commission (the "Commission") and the Arkansas Development Finance Authority(the"Authority")hereby offer to enter into this Bond Purchase Agreement(the "Agreement")with you,the Issuer, for the purchase by the Authority from moneys in the Drinking Water State Revolving Loan Fund Account, created by Arkansas Code Annotated Section 15-22-1102,as the same may be amended from time to time,including the Drinking Water Loan Account being held in connection with the Authority's Revolving Loan Fund Revenue Bonds(the"Revolving Loan Fund"),and the sale by you of the Bond of the Issuer more particularly described below. Upon approval by you and by the execution of the acceptance hereof by the Mayor of the Issuer,this Agreement shall be in full force and effect in accordance with its terms and shall be valid,binding,and enforceable upon the Issuer,the Commission,and the Authority. Further terms of this Agreement are: 1. Upon the terms and conditions and upon the basis of the representations herein set forth,the Authority hereby agrees to purchase from the Issuer and the Issuer hereby agrees to sell to the Authority the entire Principal Amount of the Bond to be issued under and secured by the Bond Ordinance. 2. The Bond is being issued for the purpose of financing all or a portion of the costs of extensions,betterments and improvements to the water facilities described in the plan and specifications furnished by the Issuer to and concurred with by the Commission,and any necessary demolition related thereto(the "Project"), paying costs incidental thereto, and paying approved expenses incurred in connection with the issuance of the Bond. The proceeds of the Bond(as hereinafter defined)are expected to be used as set forth in Exhibit B. 3. The Bond and the Servicing Fee shall be secured by a pledge of and payable from Tax collections,subject to the terms of the Bond Ordinance. 4. The Bond shall be dated the date of the Closing. The Bond shall be authorized in an amount up to the Principal Amount identified above,and shall bear interest at the Interest Rate identified above. Principal and interest shall be amortized in accordance with the schedule set forth on Exhibit A attached hereto (which is based upon monthly repayment of principal and interest commencing on May 1, 2028 and a 20 year amortization), and the Issuer shall pay to the Authority interest on the Bond on the first day of the month after the Bond is issued and on the first day of each month thereafter to and including the Disbursement Cut-off Date. In addition to the payment of the principal and interest on the Bond,the Issuer shall be obligated to pay the Servicing Fee to the Authority. The Servicing Fee shall be payable in the same manner and on the same dates as interest on the Bond is due. The payment of the Servicing Fee is expressly made subordinate to the payment of the principal of and interest on the Bond. The Issuer agrees that any delay in completion of the Project beyond the Disbursement Cut-Off Date shall not result in any extension of the date on which principal and interest payments are to be made on the Bond. The Bond shall be subject to redemption prior to maturity, shall be payable, and shall be as otherwise described in the Bond Ordinance. Interest on the Bond shall not be excludable from gross income for federal income tax purposes. 2